How do you earn money in the stock market?

The Stock Exchange is the place where savers who want to monetize their money go. Of course, everyone wants to earn money by investing in it, but this is not easy. The big secret to winning in the stock market is called discipline. Only people with great discipline in the investment earn money in the medium and long-term. Today we show you how to make money on the stock market.

How to make money in the stock market: the keys

Let’s get in the situation. From a theoretical point of view, the stock market earns money if any of these two things happen :

  1. Purchase shares of a company at a price (for example, 20 euros) and, after a time (days, weeks, months or years), you sell them at a higher price (for example, 25 euros). In other words, buy cheap and sell expensive. This is what all investors try to achieve.
  2. Through the distribution of dividends of the company in which you have invested, that is, when it decides to give back to its shareholders.

In the practical field, investors can resort to various “strategies” to make their investment in the stock market profitable. It does not trick in the strict sense of the word, but ways to operate on a daily basis to earn money. Let’s see three quite recognized:

How to make money on the stock market: Buy & Hold

It translates as “buy and hold” and what it comes to mean is that you must buy when no one wants to do it and keep what you have bought no matter what happens and for as long as possible until you can sell at a much higher price.

This method requires maximum discipline for two reasons: first, you should not check how your investment goes on a daily basis, with which you do it once or twice a year is more than enough; And second, you have to put your mind in the long, long, long term and do not sell before 20 or 25 years . The long-term stock exchange is always profitable, you just have to maintain it.

How to make money on the stock market: Surf the ups and downs

This method consists in looking for winning trends in the medium term, that is, between one and three years, even up to five years. It is an investment job that requires patience and prior knowledge. The technical and fundamental analyzes are essential to finding these trends.

Just like a surfer looking for a good wave, when investing with this method you have to look for a good trend, even if it means waiting weeks. When you find it, you invest in it and wait until the wave grows enough. When the change in trend is detected, a conservative position is adopted and sold.

How to make money in the stock market: Operate as a trader

It is the most complicated option of all and the one that requires more discipline. Traders operate in hours, days and weeks. The most successful are the intraday traders, that is, those who buy at the beginning of the day and sell when the market closes. Logically, the volatility is maximum in such short time spaces and it is very difficult to find well-defined trends.

Operating as a trader you can earn money constantly but also lose it in the blink of an eye. The stop losses are essential to prevent the latter from happening.

In any case, the great advice we give you is that you advise well before investing in the stock market. Not everyone is capable of doing it by itself. In fact, a large part of the investors who come to it without the professional help of an expert ends up losing money. Do not let the same thing happen to you.